Government’s ‘clear commitment’ on financial inclusion welcomed

​Money Advice Trust comments on government response to House of Lords Financial Exclusion Committee report.

The Money Advice Trust has welcomed the government’s creation of a Financial Inclusion Policy Forum to drive better co-ordination in addressing the problem of financial exclusion.

The move comes in response the House of Lords Financial Exclusion Committee’s report, A country that works for everyone?, in March 2017, which recommended ”a clear strategy for improving financial inclusion in the UK” together with a “clearly designated Minister for Financial Inclusion”.

The latter recommendation was implemented by the government in the June reshuffle, with the appointment of Guy Opperman as Minister for Pensions and Financial Inclusion in the Department for Work and Pensions.

In its formal response to the Committee, the government announced that the new Financial Inclusion Policy Forum, co-chaired by the Economic Secretary to the Treasury and the Minister for Pensions and Financial Inclusion, will bring together relevant government departments, regulators, industry and consumer groups in order to “maintain an open and constructive dialogue”.

“We welcome the creation of this new Financial Inclusion Policy Forum, which is a positive step forward. Between this announcement and the creation of a designated Minister for Financial Inclusion at the Department for Work and Pensions, the government has shown a clear commitment to begin addressing the serious challenges outlined with great clarity in the Financial Exclusion Committee’s report.

“Baroness Tyler of Enfield and her colleagues deserve a great deal of credit for raising this issue higher up the agenda – as does the Financial Inclusion Commission, which did so much work during the 2010-15 Parliament to galvanise interested parties.

“The government’s response does fall short, of course, of the whole-society strategy that we believe is needed to tackle the driving factors behind financial exclusion – which include fundamental issues around poverty, problem debt, financial capability and products and services that do not always meet the needs of those on low incomes.

“Nevertheless, I hope the Financial Inclusion Policy Forum will provide a valuable means of developing solutions to many of these problems – and look forward to continuing to work with others in the sector to help keep up this momentum.”

The Financial Exclusion Committee, chaired by Baroness Tyler of Enfield, spent nearly a year taking evidence on financial exclusion from charities, industry representatives and current and former Ministers.

In a written submission to the Committee’s call for evidence in September 2016, the Money Advice Trust described financial exclusion as “a significant social problem, the scale of which necessitates a co-ordinated, whole-society strategy in response”, and called on the government to take on a “greater leadership role” in improving financial inclusion in the UK.